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0422rick
New Member

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

 
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SweetieJean
Level 15

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

It will be taken care of when you enter the 1099-R. It not deducted....just never claimed as income.

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8 Replies
SweetieJean
Level 15

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

It will be taken care of when you enter the 1099-R. It not deducted....just never claimed as income.

macuser_22
Level 15

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

When you enter the QCD amount, enter the entire $50K.   You can always give more (or less) than the RMD up to $100,000 in a year.  The only requirement is that it comes from an IRA and your age is over 70 1/2.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
SweetieJean
Level 15

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

Just be aware that some states do not have a QCD provision, so you might owe States taxes on the $50k. (One of my family members was caught by surprise on this.)
0422rick
New Member

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

But I should be able to get a deduction for the amount given to charity in excess of the RMD in this example $2,000.  So how do I show it?  How do I use TurboTax to reflect it?
macuser_22
Level 15

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

Enter a 1099-R  here:

Federal Taxes,
Wages & Income
I’ll choose what I work on (if that screen comes up),
Retirement Plans & Social Security,
IRA, 401(k), Pension Plan Withdrawals (1099-R).

OR  Use the "Tools" menu  (if online version under My Account) and then "Search Topics" for "1099-R" which will take you to the same place.

Be sure to choose which spouse the 1099-R is for if this is a joint tax return.
Be sure to pick the correct 1099-R type:  Standard 1099-R, CSA-1099-R, CSF-1099-R, RRB-1099-R.

[NOTE:  When you get to the "Your 1099-R Entries" screen where you can add another 1099-R, use "continue" to keep going as there are additional interview questions after that screen in most cases.  You can always return as shown above.]

A followup question will ask about your RMD and then if you had a QCD (if oiur age is over 70 1/2 and the IRA/SEP/SIMPLE box is checked on your 1099-R.   Enter the $50K amount as the QCD.   That will place the entire $50K on line 15a on the 1040 form (line 11a on 1040A) with "QCD" next to it and zero taxable amount on line 15b.

A QCD is NOT a deduction on schedule A, it is not taxable income at all, so it does not add to your AGI which is much better than a itemized deduction.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
0422rick
New Member

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

OK I think I understand now.  For the $2,000 to be deductible it would also have be included as income as it was an IRA distribution.  Therefore no reason to try and deduct it.  Right?
SweetieJean
Level 15

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

Right!
macuser_22
Level 15

How to deduct excess amnt paid to charity from IRA over RMD? i.e. Total paid directly to charity from IRA=$50,000. RMD=$48,000. Excess=$2,000 How to deduct?

You are confusing a RMD (Required *Minimum* Distribution) with a QCD.   One is not dependent on the other.  The only relationship is you must be 70 1/2 which requires a RMD, but *any* distribution from a Traditional IRA, up to $100,000, can be a QCD.
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
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